EU ends its threat of DVD levies on China
12.10.2006
The European Union lifted a threat to impose tariffs on DVDs from China Mainland and Taiwan, saying it's more important to prevent price increases than shield producers in Europe from less-expensive imports.
The EU closed an inquiry into whether Chinese and Taiwanese exporters of recordable digital versatile discs sell in Europe below domestic prices or below the production cost, a practice known as "dumping." The probe showed that China and Taiwan control more than four-fifths of the EU's recordable-DVD market.
"Measures would have substantial negative effects on importers, distributors, retailers and consumers," the EU said in a report endorsed yesterday in Luxembourg. The 25-nation bloc continues a separate dumping probe of recordable compact discs from China and Malaysia and a result is due within a month.
The EU is trying to balance the interests of European buyers and producers of consumer electronics including blank DVDs, which allow the storage of video, and recordable CDs, which store data or music. The bloc already imposes anti-dumping duties on blank CDs from Taiwan.
Chinese and Taiwanese recordable-DVD exporters including MDA Technology Ltd. and Prodisc Technology Inc. control about 86 percent of the market in Europe compared with around 6 percent for European producers such as France's Manufacturing Advanced Media Europe SA, according to the EU. The statistics cover the 12 months through June 2005.
European importers and distributors of recordable DVDs include a German unit of Royal Philips Electronics NV and Sony France SA, said the EU, which listed Carrefour SA and Fnac SA as retailers of the product in Europe.
Consumers in some member states would probably have to bear a "substantial part" of the cost increases resulting from European trade protection, the EU said. In countries where consumers already regard retail prices as high because of special levies on recordable media, distributors would likely have to face the "full costs" of anti-dumping duties, according to the bloc.
"The imposition of measures would be disproportionate," the EU said in its decision concluding that dumping has occurred.
The bloc also said anti-dumping duties would do little to help European recordable-DVD makers because they entered the market later than overseas competitors. Two other EU producers are Luxembourg-based TDK Recording Media Europe SA, a unit of Japan's TDK Corp., and Sony DADC Austria AG, a unit of Japan's Sony Corp.
The EU industry "is unlikely to obtain any significant benefits," the EU said. Its chances of becoming a "strong player in the short or medium term would appear quite remote."
The verdict ends a 14-month investigation that the European Commission, the EU's executive arm in Brussels, began after a group representing European recordable-DVD producers complained about dumping by China and Taiwan.
The group also filed a complaint about Chinese and Malaysian dumping of blank CDs, prompting the commission to open a separate inquiry at the same time in August 2005.
Such probes can lead the EU to impose five-year anti- dumping duties on imports from the affected countries. The bloc has 15 months from the start of a dumping inquiry to impose five-year measures.
The commission can impose provisional six-month duties within nine months of starting an investigation. The commission refrained from this step in the DVD and CD cases.
Source:
China Post
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